Jan 19, 2018 - OTHER DATA. Sowing progress | Advance estimates | Kharif and rabi MSP. ANSWERS & LUCKY WINNER OF PREV
• Cotton • Sugar • Soyben • RM Seed • Castor seed • Turmeric • Jeera NCoMM NCML Commodity Market Monitor
Date: 23-01-2018
0
NCoMM NCML COMMODITY MARKET MONITOR ANSWERS & LUCKY WINNER OF PREVIOUS WEEK’S QUIZ
NCoMM
NCML COMMODITY MARKET MONITOR ANSWERS & LUCKY WINNER OF PREVIOUS WEEK’S QUIZ
WEEKLY ONLINE QUIZ
HOME
Click on the link above to participate
Cotton
Participate in our weekly quiz and get a chance to win Amazon gift coupons. Winners will be announced in next report and OUTLOOK rewarded. |
Sugar
|
Soybean
|
RM Seed
|
Castor seed
|
Turmeric
Cotton • Soyben • RM Seed •Chilli • Jeera
OTHER DATA
Sowing progress
|
Advance estimates
| Kharif and rabi MSP
|
Jeera
NCoMM
NCML Commodity Market Monitor
Date: 23-01-2018
0 . ..MUSTARD FUNDAMENTAL SUMMARY Price Drivers
Impact
Weightage
Score (1-5) *
Lower sowing acreage in current Rabi season
Bullish
25%
4
Expectation of favourable weather condition in the coming days
Bearish
25%
2
Lower demand of mustard oil Lower oil meal export demand Hike in import duty on crude and refined oil
Bearish
20%
2
Bearish
15%
2
Bullish
15%
4
Overall fundamental score
2.8
*Bearish; 2. Marginal Bearish; 3. Consolidation; 4. Marginal Bullish; 5. Bullish Mandi
Price in Rs/ Quintal 19/01/2018
12/01/2018
Mustard
Fundamentals
%Change
Jaipur
3966
4024.85
-1.46
Alwar
3922
3973.5
-1.30
Sriganga Nagar
3660
3645
0.41
According to the latest sowing report as on 19th January 2017, mustard crop sowing acreage is reported at 66.60 lakh hectares in 2017-18 which is 5.01 per cent lower than the 2016-17 acreage of 70.12 lakh hectares at the same time period. Lower rainfall received at the time of sowing reduced the acreage in major producing state like Rajasthan. Moreover, lower remuneration in mustard crop also made farmers to switch to other crops. Expected rains in the coming days in the northern plains may help the standing crop of mustard. Rains will lead to a drop-in temperature which is good for the crop as the crops are in the vegetative stage, not in the flowering stage. As per first advance production estimate of 2017-18, India’s mustard production target is estimated at 8.1 million metric tonne which is 1.54 per cent higher than last year fourth advance production estimate of 7.977 million metric tonne. However, lower sowing acreage recorded in the present Rabi season might not let to increase the production in 2017-18 as compare to 2016-17. The government increased the minimum support price (MSP) of mustard for the crop year 2017-18 to Rs 4000 per quintal from Rs 3700 per quintal. Demand of mustard oil is lower than normal due to weakness in palm oil and soybean oil. India’s mustard meal exports in the month of December 2017 were 32.832 (provisional) thousand MT, lower by 52.48 per cent against 69.105 thousand MT in November 2017. Average FoB price of meal in December is recorded at $224 per tonne which is slightly higher than average price of $223 per tonne in the month of November. Indian imports of vegetable oil (edible and non-edible) in December 2017 is reported at 10.88 million MT which is 12.821 per cent lower than November imports of 12.48 million MT tonnes. Hike in import duty may have lower imports of oils in India. Import duty on crude rapeseed oil was hiked from 12.5 percent to 25 percent while refined rapeseed import duty is hiked from 20 percent to 35 percent.
Technical Price Analysis
Rapeseed & Mustard-Black - 42% oil content : Jaipur 5,250 5,000 4,750 4,500 4,250 4,000 3,750
Jan-18
Nov-17
Aug-17
May-17
Mar-17
Dec-16
Sep-16
Jul-16
Apr-16
Jan-16
Nov-15
Aug-15
Jun-15
3,500
Amid the reports of low acreages, the prices which showed some gains have recently started to moderate as the expectation of rains and low temperatures raised the hope of a good crop. Subdued demand of mustard oil is also weighing prices down. Prices may continue its declining streak in the nearby days and can test the support band of Rs 3915 -3900 where the current declines can stop. A crack of that level will lead to fresh leg of selling pressure pulling prices down towards Rs 3850 mark. The chances of recovery from here are not very strong and even if it happens the rise will be contained around the resistance levels of Rs 4085. Fresh buying will emerge only above Rs 4192
IMPORTANT LEVELS S2
S1
CMP
R1
R2
3850
3915
3996
4085
4192
Outlook: The prices are expected to trade with downward bias and move closer to Rs 3915.
NCoMM
NCML Commodity Market Monitor
Date: 23-01-2018
0 SUGAR FUNDAMENTAL SUMMARY Price Drivers
Impact
Weightage
Score (1-5) *
Higher sowing acreage in major producing states
Bearish
25%
2
Normal crop condition
Bearish
15%
2
Lower carry in stock
Bullish
25%
4
Higher exports
Bullish
15%
4
Higher production estimates
Bearish
20%
2
Overall fundamental score
2.8
*Bearish; 2. Marginal Bearish; 3. Consolidation; 4. Marginal Bullish; 5. Bullish
Mandi
Price in Rs/ Quintal
19/01/2018
12/01/2018
%Change
Unjha
20633.35
20820
-0.89
Rajkot
18000
18000
0
21627.5
22140
-2.31
Jodhpur
21000
Short term fundamental factors are not favouring any significant upside in jeera price from here on. Rise in acreage in Gujarat and low export demand on the wake of high prices in the domestic market are already seen weighing on the prices. However low stocks in the country is still an underpinning factor for the prices. For the coming fortnight we expect prices to show some more correction towards Rs 20340. Where the prices can stabilise for the near term. A recovery can also be expected around those levels which can push prices once again towards the recently made highs pf around Rs21100.
19000 17000 15000
Jan-18
Nov-17
Aug-17
Jun-17
Mar-17
Dec-16
Oct-16
Apr-16
Jul-16
13000
Feb-16
Acreage of jeera is expected to increase this year in Rajasthan and Gujarat due to farmers has shifted from other crops as jeera prices was firm throughout the year. As per latest Gujarat agriculture department report as on 15th January 2018, jeera sowing is reported at 3.826 lakh hectares in 2017-18 which is 37.28 per cent higher than 2016-17 acreage of 2.787 lakh hectares. However, market participants are expecting 2025 per cent higher acreage in 2017-18 as compared to last year. According to the market participants, jeera crop in Gujarat is in good condition. No major crop loss is reported in any region of Gujarat and they are expecting average yield this year. According to the trade sources, demand of jeera is expected to decline in the coming days due to higher prevailing prices and expectation of arrivals of the new crop in the month of February. International buyers are also side-lined and now they are unlikely to procure Jeera in bulk quantity. Jeera stock with stockiest at present is lower than normal which might not let spot prices to fall sharply. According to the Spice board of India, India exports of jeera in the time period of April to September 2017 is reported at 79.46 thousand MT which is 15.83 per cent higher than the export of 68.596 thousand MT in 2016 in the same time period. Higher demand of Indian jeera is due to lower production and turmoil condition in other exporting countries like Syria and Turkey. In the coming year exports are expected to be higher due to higher domestic production estimate. The Spices Board of India has estimated 2016-17 Cumin seed production at 4.85 lakh tonnes a decline of almost 4 per cent from last year production of 5.03 lakh tonnes. However, in the coming season, jeera production is expected to be higher due to higher sowing acreage in major producing states of Gujarat and Rajasthan.
Technical Price Analysis
Cumin Seed (Kala Jeera) - Unjha
23000
Jeera
Fundamentals
IMPORTANT LEVELS S2
S1
CMP
R1
R2
20340
20510
20633
20840
21100
Outlook: The prices are expected to trade under pressure and might slip towards Rs 20340 before getting any support.
NCoMM
NCML Commodity Market Monitor
Date: 23-01-2018
0
CHILLI FUNDAMENTAL SUMMARY Price Drivers
Impact
Higher exports
Weightage
Bullish
Chilli
Fundamentals Score (1-5) *
20%
Chilli exported about 2.35 lakh tonnes this compared to about 1.65 lakh tonnes an increase of about 42% from last year on the back of
4
higher production and lower prices this year.
Decrease in area and failure of crop
Bullish
25%
Cold storage stock in Guntur area in reported to be higher to around 95,000 to 100,000 MT this year as compared to 45000-48000 last year
4
on the back of higher production
Higher carryover stock
Bearish
35%
2
Lower chilli arrivals in the market indicates that stockists are holding back their stocks in expectation of higher prices as this is the lean season
Low arrivals
Bullish
20%
4
According to Telangana horticulture department and Andhra Pradesh chilli production is expected to go down by 20% -25% due to lower
Overall fundamental score
3.3
prices last year combined with a failure in crop in Madhya Pradesh
*Bearish; 2. Marginal Bearish; 3. Consolidation; 4. Marginal Bullish; 5. Bullish Mandi
In Telangana last year i.e. 2016-17 it was sown in 12.43 lakh Ha which gave a production of about 48.29 Lakh tonnes which was the highest in the recent years.
Price in Rs/ Quintal
According to trade sources an inventory of more than three lakh tonnes as opening stock is expected this year. This is because of a
19-01-2017
12-01-2017
%Change
bumper production of 18 lakh tonnes last year which together with a carryover stock took the supply to over 19 lakh tonnes
Guntur (LCA 334)
7500
7000
7.14
A score of 3.3 shows that that prices would be range bound with a bullish undertone.
Warangal (Wonder Hot)
8900
8500
4.71
New Delhi (LCA 334)
9000
8500
5.88
Technical Price Analysis
Chillies - Guntur : Bangalore
15300
Chilli prices in key Bangalore market have recently shown some recovery on account of estimated fall in production this year. Added strength is infused as the stocks of chilli are being held by the farmers in anticipation of higher prices in the ongoing lean season. Prices are ruling near to Rs 7000 levels and a further stretch towards Rs 7600 can be seen in the near term on the back of artificial shortage created by the farmers. A sustainable crack of Rs 7600 will further push prices in Bangalore market to Rs 8000-8250 mark. On the other side If prices fail to breach Rs 7600 mark which looks to be a tough resistance we might see a technical turnaround in prices. In that situation the prices can reclaim Rs 7000 and can slip even towards Rs 6500 after that.
13250 11200 9150 7100
Jan-18
Jul-16
Apr-17
Oct-15
Jan-15
Apr-14
Jun-13
Sep-12
Dec-11
Mar-11
Jun-10
Aug-09
Feb-08
3000
Nov-08
5050
IMPORTANT LEVELS S2
S1
CMP
R1
R2
5750
6500
6900
7600
8250
Outlook: The prices are expected to trade with positive bias towards Rs 7600 in Bangalore market.
NCoMM
NCML Commodity Market Monitor
Date: 23-01-2018
0
Price Drivers
Impact
Weightage
Score (1-5) *
Higher production over last year
Bearish
30%
2
Slower arrivals as farmers are holding on to the stock in anticipation of higher prices
Bullish
25%
2
Purchases by CCI
Bullish
10%
4
Higher mill demand
Bullish
15%
4
Higher exports in 201718, imports from pakistan
Bullish
15%
4
Higher global output
Bearish
5%
2
Overall fundamental 2.8 score *Bearish; 2. Marginal Bearish; 3. Consolidation; 4. Marginal Bullish; 5. Bullish Price in Rs/ Quintal 19-01-2017 Akola (Long Staple) Rajkot (29 mm)
12-01-2017
%Change
10987.1
10959
0.26
20174.35
20325.75
-0.74
11068
11125
-0.51
Abohar (Medium Staple)
Mandi
Cotton - 29 mm - Rajkot 22000
With plenty of arrivals still to hit the market and farmers holding on to the crop in anticipation of higher prices the prices have shown sharp northwardly move in the past couple pf months. However the longer term fundamentals are weak and with an anticipated bumper crop this year and high global production leading to depressed international prices the domestic prices are expected to decline in the coming months. For the short term the immediate resistance is seen standing at Rs 20530 which once broken can give way to prices for another buying for Rs 21040 mark. Current support is at Rs 19600 and that support is not likely to be broken in the next few weeks.
20000 18000 16000
Oct-17
Dec-17
Aug-17
Jun-17
Apr-17
Feb-17
Dec-16
Oct-16
Aug-16
Jun-16
Apr-16
Feb-16
14000
Dec-15
The Cotton Advisory Board (CAB) has estimated India’s cotton output to increase by 9% to 377 lakh bales (of 170 kg each), from 345 lakh bales last year despite severe pink bollworm attacks and lower production in Maharashtra and Madhya Pradesh. The output in the northern region is expected to increase 28% to 59 lakh bales from 46 lakh bales earlier on the back of a bumper crop in Rajasthan and Punjab, which is pegged at 22 lakh bales from 16 lakh bales previously and 12 lakh bales from 9 lakh bales earlier. The Cotton Association of India (CAI) has retained its December estimate of the cotton crop for 2017-18 crop year at 375 lakh bales. According to Cotton Association of India (CAI), the crop arrivals in the country up to December 31 have crossed 147.75 lakh bales in this season. By the same time last year, arrivals were about 108 lakh bales. However, two-thirds arrivals still remain. Farmers are holding on to their crop in anticipation of a better price. Mills are also stocking up on cotton in anticipation of shortage. Cotton Corporation of India (CCI) has procured around 5 lakh bales this season of which 4 lakh bales have been procured at MSP & the remaining 1 lakh bales as part of its commercial operations. With cotton prices firming up to around Rs 5,300 per quintal, farmers are finding it more lucrative to sell cotton in the open market. The mill consumption of cotton this year is estimated to be higher at 288 lakh bales from 263 lakh bales earlier. As per the Cotton Advisory Board, Cotton export is estimated to increase by 15% to 67 lakh bales (of 170 kg each) in the current 2017-18 marketing year, which started in October, because of the rise in the output of the commodity and import by Pakistan. Internationally, the prices may remain under pressure as higher crop is expected. According to International Cotton Advisory Committee (ICAC), global cotton output is likely to rise 10% to 25.4 million tonnes in 2017-18 (from 23.05 million tonnes previous year) on expected production increase in India and the US. The higher forecast is due expansion in acreage by 3 million hectares to over 32 million hectares across the world. The most significant portion of the increase will come from the USA which should record an output of 4.6 million tons in 2017/18, up 23% compared to the previous season.
Technical Price Analysis
24000
Nov-15
Cotton
Fundamentals
COTTON FUNDAMENTAL SUMMARY
IMPORTANT LEVELS S2
S1
CMP
R1
R2
19150
19610
20265
20530
21040
Outlook: In the short term the prices will continue its rising streak and move closer to Rs 20530. Beyond that a sharp move towards Rs 21000 can be seen.
NCoMM
NCML Commodity Market Monitor
Date: 23-01-2018
0
Price Drivers
Impact
Weightage
Score (1-5) *
Significantly lower production over last year Incoming arrivals, but lower than last year Hike in import duty
Bullish
30%
4
Consolidation
20%
3
Bullish
10%
4
Lower soymeal export Lower domestic soybean inventories
Bearish
15%
2
Bullish
10%
4
Concerns over dry weather in Argentina and delays in Brazilian harvest Higher global output
Bullish
5%
4
Bearish
10%
2
Overall fundamental 2.8 score *Bearish; 2. Marginal Bearish; 3. Consolidation; 4. Marginal Bullish; 5. Bullish Mandi
Price in Rs/ Quintal 12/01/2018
05/01/2018
Soyabean
Fundamentals
SOYABEAN FUNDAMENTAL SUMMARY
%Change
Indore
3414
3303
3.36
Kota
3275
3210
2.02
Nagpur
3434
3282.5
4.62
As per first advance production estimate of 2017-18, India’s soybean production is estimated at 12.217 million metric tonne which is 11.43 per cent lower than the 2016-17 production estimate of 13.794 MMT. However, market participants are estimating soybean production to be around 8 million metric tonnes for 2017-18. Lower availability in the domestic market amidst lower arrivals in the mandis coupled with good demand are providing continued support to the market. Soybean is trading at 6 month high as supplies have been diminishing slowly in the physical market. The arrivals have been lower during December compared to last year. According to SOPA, soybean inventories with farmers, traders & plant owners at the end of December were 6.5 mt, down from 8.2 mt last year. Demand of soybean is higher than normal as stockiest are active in the market. Moreover, good demand for edible oils during winter season remains supportive to the cash market. Edible oil producers are also planning to increase their operating capacities due to government’s decision to increase the import duty on vegetable oils. Import duty on crude soy oil was hiked from 17.5 percent to 30 percent while refined soy oil import duty is hiked from 20 percent to 35 per cent. Soymeal prices are also firm due to good demand from the poultry industry in the domestic market. According to industry sources, exports of oil meals are likely to decline in the current marketing year due to higher prices in the domestic market. The Soybean Processors Association of India (SOPA), India's soymeal exports during December fell 32% on year to 224,000 tonnes from 327,000 tonnes a year ago. India's soymeal exports could fall by at least a fifth in 2017/18 from a year ago due to rally in local soybean prices and a firmer rupee. The Soybean futures gathered a rally on the back of a positive trend in global market. Building up of huge positions by speculators, tracking a firm trend in overseas markets on concerns over dry weather in Argentina and delays in Brazilian harvest, supported the strong rally. However, record supply scenario in the global market will continue to remain the limiting factor in the market. Global soybean production estimate for 2018 is expected to be higher assuming weather remains favourable in the growing regions.
Technical Price Analysis Soybean Indore
4700
On account of lower availability leading to lower arrivals in the market coupled with good demand have collectively given strength to the prices. With positive fundamental factors in place we can expect some more near term upside. Pieces will continue to rise and move closer to the 3670 mark where some strong resistance is seen standing. Some technical supply pressure will emerge around those levels and correction can be seen pulling down prices from those levels. As the recent spike was sharp the supports are seen quite far and the correction could be sharp if happens. Nearest support is at Rs 3400 and on a slip below that sharp correction towards Rs3175 can be seen.
4300 3900 3500 3100
Jan-18
Oct-17
Jul-17
Apr-17
Dec-16
Sep-16
Jun-16
Mar-16
Nov-15
2700
IMPORTANT LEVELS S2
S1
CMP
R1
R2
3175
3400
3524
3665
3815
Outlook: The prices are expected to rule high and test Rs 3665 before some selling pressure can be experienced.
NCoMM
NCML Commodity Market Monitor
Date: 23-01-2018
0
THE WEEK THAT WAS Basmati export to Iran likely by next week Wheat area still down; overall rabi acreage close to normal Rain to hit North India soon, to help wheat, mustard crops Gujarat wants Nafed to purchase more groundnuts
PRICE TRACKER Commodity
Latest
Red chilli to turn costlier by March Commerce Ministry wants no price curbs on most farm exports Palm oil futures will test supports, risk
Link for commodity-wise and market-wise prices and arrivals: http://agmarknet.gov.in/PriceAndA rrivals/CommodityWiseDailyReport 2.aspx
Official Production Estimates First advance estimates 2017-18 & previous years’ estimates : First Advance Estimates 2017-18
Month ago
Year ago
19-Jan-18
05-Jan-18
19-Dec-17
19-Jan-17
Soyabean
3414
3223
3086
3142
RM seed
3996.25
4065.85
4100
4344.25
Turmeric
7650
7675
7697.05
7325
Cotton
20174.35
19781.95
19052.9
20091.25
Chilli (LCA 334)
7500
6700
6600
8000
Jeera
20633.35
20710.7
21064.3
18555.75
Castor
4075.25
4326.45
4516.1
4002.95
Sugar production to be up by 4%; exports possible, says ISMA Sugar processors undermine their own margins to meet payments to cane farmers
Fortnight ago
MINIMUM SUPPORT PRICE (Rs/Qtl.) Commodity
2016-17
2017-18
KHARIF
Paddy Common paddy grade A Jowar Hybrid Jowar Maldandi
1470 1510
1550 1590
1625 1650
1700 1725
Bajra
1330
1425
Ragi
1725
1900
Maize
1365
1425
Tur
5050
5450*
Moong
5225
5575*
Urad Groundnut Sunflower seed Soyabean black Sesamum
5000
5400*
4220 3950 2775
4450* 4100 # 3050
5000
5300 #
Nigerseed
3825
4050 #
Cotton(Medium Staple) Cotton(Long Staple)
3680 4160
4020 4320
2016-17 1625 1325
2017-18 1735 1410
4000*
4400
3950* 3700*
4250 4000
3700*
4100
1625
1735
RABI
Commodity Wheat Barley Gram Masur (Lentil) Rapeseed/Mustard Safflower Wheat
*includes bonus of Rs 200 per quintal # includes bonus of Rs 100 per quintal
NCoMM
NCML Commodity Market Monitor
0
RABI SOWING PROGRESS- Link
Date: 23-01-2018
NCoMM
NCML Commodity Market Monitor
Date: 23-01-2018
0
Answers for 16 Jan Quiz: Ans 1: Guarseed
Ans 2: 4.90%
Ans 3: Wheat
People who gave correct answer: Mayank Mishra Tejkumar HM
Riteshkumar Sahu Laxmikant
Abinandhan Ramamoorthy Mahesh Kumar Ramaswamy
Lucky Winner: Abinandhan Ramamoorthy
Advisory Team Basant Vaid
Head: TCIG
[email protected]
Sreedhar Nandam
Vice President: SCM
[email protected]
Suresh Solanki
Assistant Manager: TCIG
[email protected]
Kamna Malhotra
Economist: TCIG
[email protected]
Akash Jaiswal
Research Analyst: TCIG
[email protected]
Ansh Aggarwal
Senior Officer: Trade Support
[email protected]
Research Team
For any research queries, contact us at
[email protected]
Disclaimer: This consultancy report has been prepared by National Collateral Management Services Limited (NCML) for the sole benefit of the addressee. Neither the report nor any part of the report shall be provided to third parties without the written consent of NCML. Any third party in possession of the report may not rely on its conclusions without the written consent of NCML. NCML has exercised reasonable care and skill in preparation of this consultancy report but has not independently verified information provided by others. No other warranty, express or implied, is made in relation to this report. Therefore, NCML assumes no liability for any loss resulting from errors, omissions or misrepresentations made by others. Any recommendations, opinions and findings stated in this report are based on circumstances and facts as they existed at the time of preparation of this report. Any change in circumstances and facts on which this report is based may adversely affect any recommendations, opinions or findings contained in this report. © National Collateral Management Services Limited (NCML) 2018
